HomeMy WebLinkAboutSept 29, 1986 (2) OFFICIAL PROCEEDINGS
COLUMBIA HEIGHTS CITY COUNCIL
oPUBLIC HEARING
SEPTEMBER 29, 1986
The hearing was called to order by Mayor Nawrocki at 7:45 p.m..
1. Roll Call
Paulson, Petkoff, Carlson~ Peterson, Nawrocki - present
2. Purpose of the Hearing
Consider a staff report and to hear a presentation from North Central Cable Com-
munications Corporation regarding the request to transfer ownership of Group W
Cable of Columbia Heights/Hilltop, Inc.. Also, public comment on this matter will
be taken at this time.
3. Staff Report
Gary Matz, legal counsel to the City regarding cable matters, advised the Council
that the Council has received a complete request for approval of sale of the stock
involving the cable television franchisee, Group W Cable of Columbia Heights/Hill-
top, Inc. The proposed transaction involves the transfer of eighty four percent
of the stock of Group W Cable of Columbia Heights/Hilltop, Inc. from Group W Cable,
Inc. to North Central Cable Communications Corporation.
Matz reviewed the legal and technical qualifications of the new company for the
Council and stated that he is of the opinion that the new company possesses the
necessary qualifications on both areas. His conclusion was that he believes that
North Central is qualified to own, operate, and control the cable television
system in Columbia Heights/Hilltop.
Don Richards, of Don Richards Associates, Inc., reviewed the financial qualifications
of the new company. In his analysis of the financial qualifications of North Central
Cable Communications Corporation he reviewed the corporation structure, sources of
capital, and balance sheets. Richards felt that the investment ultimately would not
yield a very high rate of return to the investors. He also gave examples of the
projected penetration of cable television in this area with scenarios of what could
happen financially with Iow penetration as well as financial difficulties which
could arise.
Representatives of North Central Cable responded to comments made by Gary Matz and
by Don Richards. Exception was taken with the concern expressed by Richards regarding
the financial stability of the corporation in the future. The representatives requested
the process for approval be acted upon as soon as possible noting the delays which
have been experienced to date. It was noted that the cable system will continue to
operate even if there were to be problems experienced by the owners and that there
was no risk to the City. There will be a written response prepared to the analysis
of Gary Matz and Don Richards.
Councilmember Paulson observed that the first transaction was cancelled at the request
of one of the system's buyers therefore he felt the delay was not the fault of the City.
He also observed that he clearly anticipates there will be requests for changes to
the franchise in the future although this is not a stated consideration at this point
in time. Mayor Nawrocki said the timetable for the stock transfer was not of the
Council's choosing and he requested that the written responses to the analysis be
objective. The Mayor felt that there would be inherent risks in this transfer to the
resident subscribers as well as environmental changes. Councilmember Petkoff inquired
what would be the situation if the Council did not grant approval.
P~lic Hearing
September 29, 1986
page 2
egal counsel Matz advised the Council that it has three options in this matter;
i) to approve as is; 2) to approve with certain terms and conditions attached,
and, 3) to deny approval. He noted that for the Council to deny approval it would
have to have a reasonable basis for its action. Matz observed that courts tradi-
tionally afford cities considerable discretion in making that determination.
Motion by Petkoff, second'by Paulson to continue this public hearing until the
Regular Council Meeting on Monday, October 13, 1986 at 7:30 p.m.. Roll call: All
ayes
4. Adjournment
Motion by Paulson, second by Peterson
All ayes
Student, Council Secretary
to adjourn the hearing~at ~:4.~'p.m.. Roll call:
May-'O~ Bruce G. Nawrocki